More tenant-power and rent controls demanded by key think-tank

An influential think tank is calling on government to radically reform the private rental sector because a generation of young people face the prospect of never owning their own home.

A report called Home Improvements, written by the Resolution Foundation, demands tax reforms to discourage multiple home ownership and better support to encourage home ownership among the young, along with support for councils to get more affordable homes built.

The Foundation says four in 10 millennials - those born between 1980 and 2000 - rent privately, four times that for baby boomers at the same age. 

It says that as more millennials reach child-rearing years, the rental sector is ill-equipped to cater for families. In 2003, the number of children in owner-occupied housing outnumbered those in the private rental sector by eight to one. That ratio has now fallen to two to one as 1.8m families with children rent privately, up from just 600,000 15 years ago.

The think tank describes the private rental sector as “the least secure and lowest quality tenure” with a claim that two-month notice periods are standard, and one in four properties failing the decent homes standard. 

“The fact that many tenants are on six or 12 month fixed term contracts also means that the prospect of large rent rises at short notice are a big concern” it adds.

It goes on to say that if home ownership growth follows the weak pattern of the 2000s, up to half of millennials could be renting - either privately or in the social rented sector - in their 40s, and a third could still be renting by the time they claim their pensions.

This rising share of retiree renters, coupled with an ageing population, could more than double the housing benefit bill for pensioners from £6.3 billion today to £16 billion by 2060 – “highlighting how everyone ultimately pays for failing to tackle Britain’s housing crisis.”

The Foundation is calling for:

- the introduction of indeterminate tenancies as the sole form of contract in England and Wales, following Scotland’s lead and the practice in Germany, the Netherlands, Sweden and Switzerland;

- ‘fair balancing’ of the needs of tenants with the rights of landlords. “A landlord could remove a tenant that fails to pay the rent or treat the property well, or if they wishes to sell or reoccupy the home, but cannot simply end the tenancy at short notice without good cause”;

- ‘light-touch rent stabilisation that limits in-tenancy rent rises to inflation for three-year periods;

- a new housing tribunal, to ensure landlords and tenants can have disputes resolved swiftly.

“Britain’s housing problems have developed into a full-blown crisis over recent decades and young people are bearing the brunt – paying a record share of their income on housing in return for living in smaller, rented accommodation” says 

Lindsay Judge, senior policy analyst at the Foundation.

“While there have been some steps recently to support housebuilding and first time buyers, up to a third of millennials still face the prospect of renting from cradle to grave.

“If we want to tackle Britain’s ‘here and now’ housing crisis we have to improve conditions for the millions of families living in private rented accommodation. That means raising standards and reducing the risks associating with renting through tenancy reform and light touch rent stabilisation.

“For any housing strategy to be relevant and effective for people of all ages, it must include this combination of support for renters, first time buyers and ultimately a level of housebuilding that matches what the country needs.”